What did Hundert develop as a teacher in The Palace Thief?
Unfortunately, even though Hundert develops a legendary reputation for integrity after teaching three generations of students, what he ultimately develops is his tendency towards isolation due to a lack of trustworthiness in both his school and the world.
As a teacher, Hundert is honest and true. Hundert has taught three generations of students history without incident... until now. Enter Sedgewick Bell, the son of a prominent senator. Sedgewick Bell continually cheats, lies, and bullies. Even the important Tournament of Roman History is almost won due to Sedgewick Bell's cheating! The headmaster at the time cowers under the weight of power and tells Hundert to ignore the cheating and move on. The higher-ups at the school as well as Sedgewick Bell's senator father continually badger Hundert and prevent him from taking any action against Sedgewick Bell.
Unfortunately, Sedgewick Bell grows up to be as corrupt a business owner as his father was a senator. Sedgewick Bell, now a chairman of a huge corporation, schedules a rematch of the Tournament of Roman History. Again, Sedgewick Bell wins by cheating. Echoing his past with Sedgewick Bell as a student, Hundert again cowers under the weight of the other academics and does not expose Sedgewick Bell as he should be exposed.
This is a true moral failure.
Further, neither Hundert nor Sedgewick Bell has changed. Hundert remains a coward and Sedgewick Bell remains a corrupt cheat. The only semblance of moral success can be seen in Hundert's retirement in order to warn others of corruption. However, even that is in question, because Hundert really wanted the headmaster position, but was denied such (despite his legacy at the school).
Although he prides himself on his integrity and his role as the molder of the young, Hundert was once manipulated by a powerful senator into making allowances for his ne’er-do well son, whom Hundert knows to have cheated and whose dishonesty he has never exposed.